Best of Dennis – How Long Can Investors Afford To Ignore Reality?
Guest Post by Dennis Miller at Miller On The MoneyBest of Dennis…
Dennis is taking a week off due to travels, but he will be back writing soon. In the meantime, with equity markets and economic fundamentals seemingly drifting further apart, this article from November 20, 2025 is well worth a second look. Take a moment to revisit Dennis’s timely warning on market complacency and ask yourself: just how long can investors afford to ignore reality?
Alice O’Connor, using her pen name Ayn Rand, was a Russian-born American writer and philosopher. She is credited with explaining, “You can choose to ignore reality; but you cannot ignore the consequences of ignoring reality.” If only it were that easy.
In today’s world, with artificial intelligence, what is reality? The media lies, the government lies, our educational system is heavily politically biased; investors must sort through the mountains of data in an effort to determine what is reality, versus political hype or just plain fantasy. We constantly worry about safety, while trying to grow our wealth.
Many Baby Boomers (myself included) were flying high, and totally shocked (literally overnight) by the 2008 bank bailout. A major market correction, historic low interest rates for over a decade, followed by high inflation which derailed most retirement plan calculations. Did we understand what was going on with the “too big to fail” banks when Glass-Steagall was repealed?
Whether we ignored – or failed to understand – reality, made little difference. The adverse consequences affected millions of Americans. Retirement dreams were destroyed; lives were irreversibly changed.
I was encouraged when friend Urs Vrijhof-Droese, Chief Investment Officer of WHVP recently wrote, “When The Music Stops”:
“One thing that stood out to us in 2025 is how much more seriously Americans have started to take the protection of their wealth. The growing eagerness to find safety is not surprising.
The…foreign and domestic demand for Treasuries is weakening, and the national debt has now reached USD 37 trillion as of August 2025. Against this backdrop, it becomes clear that relying exclusively on the U.S. market is not so much a strategy as it is the neglect of reality.
…. That does not mean the rest of the world is free of problems. Far from it. Global government debt hit yet another all-time high in 2024, climbing to USD 102 trillion.”
Urs is waving a caution flag for the world. It’s time to check in for his global perspective.DENNIS: Urs, thanks again for taking your time for the benefit of our readers. Your worldview insights are appreciated.
It seems like history is repeating itself. You went on to say:
“And yet—Markets Reach New All-Time Highs
This contradiction has almost become routine. Indices tell one story of wealth and prosperity, while the real economy tells another. I sometimes tire of pointing out this dispersion, but it remains necessary because the gap keeps widening.
Stock indices long ago stopped being a reliable indicator of economic wellbeing. Today, fewer than 10% of the companies in some of the main indices account for nearly half the market capitalization and drive performance almost single-handedly. That is not healthy. It is concentration risk of the highest order.”
While you may tire of waving a yellow flag, there are many pension funds, mutual funds, and millions of individual investors who have a considerable portion of their life savings in those “Magnificent 7” stocks. Please elaborate on the “not healthy” comment.
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[ H/T The Burning Platform ]
